Taylor, Inc. is projecting sales to increase by 7% next year with the profit margin remaining constant. The firm is increasing the dividend payout ratio to 50 percent. 

$822.16 

$989.13 

$1,106.67 

$1,278.65 

$1,534.38 

The following balance sheet and income statement should be used:  

Hilltop, Inc. 2009 Income Statement
Net Sales	$38,900
Less: Cost of Goods Sold	31,400
Less: Depreciation	2,600
Earnings Before Interest and Taxes	4,900
Less: Interest Paid	1,800
Taxable Income	$3,100
Less: Taxes	1,150
Net Income	$1,950
Dividends	$390
Additions to retained earnings	$1,560

  

Hilltop, Inc. 2009 Balance Sheet
Cash	$3,160	Accounts Payable	$8,120
Accounts rec	4,160	Long-term debt	21,200
Inventory	6,480	Common stock	7,500
Total	$13,800	Retained earnings	6,380
Net fixed assets	29,400
Total assets	$43,200	Total liabilities & equity	$43,200

 

What is the amount of the projected addition to retained earnings for next year?

Answer rating: 100% (QA)

To calculate the projected addition to retained earnings we need to determine the net income for nex... View the full answer